Developers will likely have to pay more in fees to the local government if they choose not to build housing for the employees their projects generate, based on a study that is in draft form.
How much the current cash-in-lieu fee falls short is not clear because the analysis is still in the works, said Melanie Rees of Denver-based Rees Consulting, which is producing the study. The city and county governments are paying for the work.
The city requires developers to provide affordable housing for 60 percent of the employees generated by their projects, either by paying a fee, or providing it on site or elsewhere.
As it stands, cash-in-lieu fees range from $135,816 to $275,596, depending on the income category of affordable housing that the developer is funding.
Local affordable housing developer Peter Fornell said the current fees are too low for the government or anyone else to build affordable housing developments.
“I can’t compete with the current cash-in-lieu number,” Fornell said.
The fees should increase and serve as a last resort for developers, so that they won’t rely on the local government to build affordable housing units for them, he said.
“If we’re going to take the money, we better be darn certain that we can build with those dollars,” Fornell said.
The draft study currently indicates that there should be a significant increase in the fees compared to what they are now, but local officials still need to give additional input that will be incorporated into the analysis before anyone can speculate about how drastic the hike will be, said Tom McCabe, director of the Aspen/Pitkin County Housing Authority (APCHA).
The group that is responsible for conducting the study and providing recommendations to Aspen City Council and Pitkin County commissioners met last week to discuss the draft, Rees said. Group members include Rees, McCabe and representatives from the city and county, she said.
When it’s completed, the study will give APCHA a new formula to determine how much developers have to pay for affordable housing credits. The formula will be individualized for the city and county, Rees said.
Rees predicts that the information will be presented to council and the commissioners in February, she said.